How AI Is Disrupting The HR Technology Market

Summary

The video script discusses the impact of AI on the HR technology market. It explains AI's advanced algorithms and their evolution over 40 years, highlighting their use in identifying patterns in data across various formats. The script then explores AI's application in HR, from IBM Watson's early machine learning to modern AI's ability to predict employee performance and recommend actions. It categorizes vendors into AI-centric, AI-feature, and non-AI, emphasizing the need for constant model updates due to AI's rapid advancement. The script concludes by stressing AI's potential in transforming HR through interconnected data analysis, aligning with the concept of systemic HR.

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Q & A

What is AI and how does it relate to the HR technology market?

AI is an advanced set of algorithms, mathematical models, statistics, neural networks, and linear algebra that has been refined over more than 40 years to identify objects from data and analyze patterns in images, text, video, or audio. In the HR technology market, AI is used to optimize decisions about people, such as hiring, promotions, and performance evaluations, by analyzing vast amounts of data.

How does AI classify information?

AI classifies information by analyzing patterns in data and using statistical methods to categorize it. For example, it can distinguish between a cat and a dog or identify linguistic patterns to determine the correct order of phrases in a sentence.

What is generative AI and how does it apply to HR?

Generative AI uses statistical approaches to create conversations and language. In HR, it can be used to create more natural and human-like interactions, such as chatbots that can understand and respond to complex queries from employees or candidates.

How did AI start being used in HR and what was its initial focus?

AI started being used in HR around 10 years ago, primarily with machine learning to analyze patterns in hiring, promotions, and performance data. The initial focus was on using AI to make better people-related decisions within companies.

What is the role of AI in applicant tracking systems?

AI in applicant tracking systems is used to analyze resumes and job histories to match candidates' skills with job descriptions. It helps in the selection process by identifying and indexing relevant skills from complex data.

How has AI evolved in HR over the past decade?

Over the past decade, AI models have become more sophisticated with billions of nodes and advanced optimization strategies. They now analyze more data and learn from it, improving their accuracy and relevance in HR applications such as recruitment, performance management, and career development.

What does it mean for AI systems to be trained on both internal and external data?

Training AI systems on both internal and external data means that they use data from the company (internal) and from a broader workforce (external) to make more informed decisions. This combination allows the AI to understand industry trends and enrich its recommendations with a global perspective.

Why is AI disruptive for traditional HR tech vendors?

AI is disruptive for traditional HR tech vendors because it requires constant updates and improvements to the models used in their systems. Vendors must adapt quickly to advancements in AI or risk being outpaced by competitors with more advanced models.

What is the significance of prompt engineering in AI for HR?

Prompt engineering is the process of teaching AI systems to understand complex questions by asking them in a series of iterative steps. This is significant for HR because it allows AI systems to provide more accurate and relevant answers to complex HR-related queries.

How does AI change the user interface and experience in HR systems?

AI changes the user interface and experience in HR systems by allowing for more natural language interactions and personalized assistance. Instead of navigating through screens and buttons, users can ask complex questions and receive tailored responses, improving efficiency and user satisfaction.

What are the three categories of vendors in the HR technology market in relation to AI?

The three categories of vendors in the HR technology market are: 1) AI Centric vendors, founded by AI engineers and built on AI technology at their core; 2) Vendors with AI expertise that use AI as an add-on feature to their systems; and 3) Traditional software vendors that may not have AI capabilities and are unsure how to integrate AI into their products.